The US Commodity Futures Trading Commission is embracing artificial intelligence and automation to tackle its expanding regulatory duties, according to Chairman Mike Selig's congressional testimony, despite a significant decline in the agency's workforce under the Trump administration. Since 2025, approximately a quarter of the CFTC's staff has departed, owing to President Trump's push for a leaner federal workforce.
However, the CFTC is now tasked with overseeing the rapidly evolving cryptocurrency and prediction markets. Selig emphasized that AI tools will play a crucial role in monitoring and investigating these markets, citing the widespread adoption of Microsoft's Copilot AI tool as a key productivity aid. When questioned about the staffing reductions, Selig asserted that the agency is operating more efficiently and effectively.
Committee Chairman Glenn 'GT' Thompson expressed concern about the CFTC's ability to handle its increased workload, particularly with regards to digital assets and prediction markets. Selig assured him that he would seek assistance from the panel if the need for additional qualified staff arises. The CFTC is currently pursuing a preliminary rule process to establish guidelines for US prediction markets, and Selig has also initiated policy initiatives in the crypto space. The agency's budget request for the upcoming year includes a modest increase in enforcement staff, but this still falls short of the 140 personnel the division had in 2025.
The Digital Asset Market Clarity Act, currently being worked on by the Senate, would grant the CFTC a central role in regulating non-securities crypto trading, encompassing transactions in prominent assets like bitcoin and Ethereum's ether. The agency is also claiming jurisdiction over prediction markets, such as those operated by Polymarket and Kalshi, which have experienced rapid growth. Selig's predecessor, former Chairman Rostin Behnam, had consistently argued that the agency required more personnel to effectively oversee crypto and prediction markets.
During Selig's tenure, the prediction markets have been marred by accusations of insider trading, with some cases being addressed by the firms themselves. The chairman acknowledged that numerous investigations are ongoing in prediction markets, although he declined to provide specifics.
He emphasized that regulated platforms serve as the first line of defense against illicit activities, while the CFTC acts as a second line of defense. Selig noted that his agency regularly rejects contracts and is actively reviewing the markets to prevent insider trading, fraud, and market manipulation. The committee's top Democrat, Representative Angie Craig, argued that the agency's workforce is overextended, particularly given its role as the primary regulator of two of the fastest-growing and most volatile markets. Craig stressed that the CFTC needs adequate staffing, funding, and statutory authority to fulfill its duties.
The White House has been criticized for leaving the commission with only one member, Selig, despite the law requiring five members, including two from the minority party. The chairman was questioned about his plans to proceed with major rules as a one-person commission, and he indicated that he would move forward with new regulations. Thompson and Craig plan to send a letter to the White House, urging them to promptly fill the vacant commissioner positions with nominees from both parties.